Dow declined 190 (remaining near opening lows all day), decliners over advancers 5-2 & NAZ pulled back 44. The MLP index dropped 2+ to the 255s & the REIT index fell 2+ to the 379s. Junk bond funds hardly budged & Treasuries continued to be purchased in the PM. Oil fell to 64 on profit taking (more below) & gold went up 6 to 1308.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Boeing (BA), a Dow stock, said that deliveries & new orders for all of its 737 jets fell in Q1. The plane maker has halted deliveries of the 737 Max, the latest model of the popular narrow-body jet, after faulty data feeding into the aircraft's automated flight system was implicated in 2 fatal crashes that killed all 346 people aboard the flights. BA announced Fri that it's cutting production by 20% as it tries to find a software fix to get the planes flying again. They've been grounded since the 2nd crash in mid-Mar. Deliveries of its 737s tumbled to 89 during the first 3 months of the year, a dip from 132 during the same period last year. Total orders for 737s, the majority of which were for the newer Max model, fell to 95 in Q1, a drop from 180 a year earlier. There were no new 737 Max orders in Mar. The stock dropped another 5+ to 369
If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
Boeing first-quarter deliveries and orders sink after 737 Max grounding…
Oil futures finished with a loss, a day after settling at 5-month highs, pressured by expectations that US crude supplies climbed for a 3rd straight week, as well as signs that Russia may not see a need to extend production cuts past Jun. Still, traders remained cautious around potential supply outages tied to civil unrest in Libya. US benchmark West Texas Intermediate crude for May delivery lost 42¢ (0.7%) to settle at $63.98 a barrel. Yesterday, prices based on the front-month contract rose for a 6th straight session & marked the highest finish since Oct 31. Jun Brent fell 49¢ (0.7%) to $70.61 a barrel. The contract's settlement at $71.10 yesterday was the highest for a front-month contract since Nov.7. Of immediate concern, however, may be the data on US oil & oil-product supplies, with gov data due tomorrow from the EIA. The American Petroleum Institute will release its own figures later today. US crude inventories likely rose 2.8M barrels last week. That would follow increases in each of the previous 2 weeks. In a monthly report today, the EIA did lift its forecast for 2019 US crude production to 12.39M barrels a day, up 0.7% from the Mar forecast & raised its 2020 output view by 0.5% to 13.1M barrels a day. For 2019, the gov agency lifted its West Texas Intermediate crude price outlook by 4.8% to $58.80 a barrel & its Brent view by 3.8% to $65.15. Meanwhile, a Russian official suggested that Russia wanted to raise oil production when it meets with OPEC in Jun given improving market conditions & falling stockpiles.
Stocks are losing their friends in Apr. After a good start in the first week, selling is now the popular emotion for traders. Even sexy tech stocks are being sold. Trade issues are not being resolved. Earnings from the big banks will be reported in the next few days followed by corp results. Expectations are low. More selling seems to lie ahead.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Boeing (BA), a Dow stock, said that deliveries & new orders for all of its 737 jets fell in Q1. The plane maker has halted deliveries of the 737 Max, the latest model of the popular narrow-body jet, after faulty data feeding into the aircraft's automated flight system was implicated in 2 fatal crashes that killed all 346 people aboard the flights. BA announced Fri that it's cutting production by 20% as it tries to find a software fix to get the planes flying again. They've been grounded since the 2nd crash in mid-Mar. Deliveries of its 737s tumbled to 89 during the first 3 months of the year, a dip from 132 during the same period last year. Total orders for 737s, the majority of which were for the newer Max model, fell to 95 in Q1, a drop from 180 a year earlier. There were no new 737 Max orders in Mar. The stock dropped another 5+ to 369
If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
Boeing first-quarter deliveries and orders sink after 737 Max grounding…
The EU is firing back at the latest tariff threat by the US. The European bloc threatened to prepare its owns tariffs against the US for allegedly providing illegal subsidies to BA,
one day after the US proposed to impose tariffs worth $11B on a
slew of European goods, a direct retaliation for the EU's
alleged illegal subsidies to Airbus. Daniel
Rosario, a spokesperson for the European Commission, said the European
governing body remains open to discussions, so long as they’re not based
on pre-conditions. “Our ultimate goal is to reach an agreement with
the EU to end all WTO-inconsistent subsidies to large civil aircraft,”
US Trade Representative Robert Lighthizer said. “When the EU ends
these harmful subsidies, the additional U.S. duties imposed in response
can be lifted.” The dispute dates back to 2004,
when the US first accused the EU of subsidizing aircraft produced by
Airbus & brought it to the attention of the WTO. The case is still
unresolved. The EU, however, has also accused the US of illegally
subsidizing BA, the main rival of Airbus. The WTO has found that
both the EU & the US doled out subsidies. Pres Trump also waded into the dispute on
Twitter today, criticizing the EU for taking advantage of US
trade for “many years.” “It will soon stop!” he wrote.
Airbus dispute: US threatens EU with $11B in tariffs
China & the EU agreed to
strengthen their trade relationship, pledging to work toward making it
easier for foreign investors to get access to China, the world's 2nd
biggest economy. In a joint statement, the 2
sides said they committed to widening market access & eliminating
discriminatory requirements for foreign companies & agreed that
businesses should not be forced to transfer their technology, issues
that foreign investors in China have long complained about. EU
leaders Donald Tusk, Jean-Claude Juncker & Chinese Prime Minister
Li Keqiang discussed the issues at their summit before claiming a
breakthrough in their trade relationship. "Negotiations
have been difficult but ultimately fruitful," Tusk said." We managed to
agree a joint statement which sets the direction for our partnership
based on reciprocity." The
stakes at the annual summit were high, with 2-way trade between the
EU & China worth around €575B ($648B) annually. The
EU is China's biggest trading partner, while for the EU, only the
US is bigger. The EU & China also
said they reaffirmed the "rules based multilateral trading system" with
the World Trade Organization at its core & plan to intensify
discussions aimed at beefing up intl rules on industrial
subsidies. China wants a bigger role in the WTO & other intl organizations like the UN & the
IMF. But China's ample financial support for
state-owned companies has been the target of Western trade officials. EU
Trade Commissioner Cecilia Malmstrom has in the past called out China
for "unfair trade practices" including gov subsidies intended to
give its companies a competitive advantage. The leaders discussed
China's policy of forcing foreign companies to turn over intellectual
property as a condition for access to its big & growing market, an
issue that DC has also made a centerpiece of its trade dispute
with Beijing. In their closing statement, they said: "Both sides agree that there should not be forced transfer of technology."
China, EU agree to strengthen trade relationship
Oil futures finished with a loss, a day after settling at 5-month highs, pressured by expectations that US crude supplies climbed for a 3rd straight week, as well as signs that Russia may not see a need to extend production cuts past Jun. Still, traders remained cautious around potential supply outages tied to civil unrest in Libya. US benchmark West Texas Intermediate crude for May delivery lost 42¢ (0.7%) to settle at $63.98 a barrel. Yesterday, prices based on the front-month contract rose for a 6th straight session & marked the highest finish since Oct 31. Jun Brent fell 49¢ (0.7%) to $70.61 a barrel. The contract's settlement at $71.10 yesterday was the highest for a front-month contract since Nov.7. Of immediate concern, however, may be the data on US oil & oil-product supplies, with gov data due tomorrow from the EIA. The American Petroleum Institute will release its own figures later today. US crude inventories likely rose 2.8M barrels last week. That would follow increases in each of the previous 2 weeks. In a monthly report today, the EIA did lift its forecast for 2019 US crude production to 12.39M barrels a day, up 0.7% from the Mar forecast & raised its 2020 output view by 0.5% to 13.1M barrels a day. For 2019, the gov agency lifted its West Texas Intermediate crude price outlook by 4.8% to $58.80 a barrel & its Brent view by 3.8% to $65.15. Meanwhile, a Russian official suggested that Russia wanted to raise oil production when it meets with OPEC in Jun given improving market conditions & falling stockpiles.
Oil rally takes a timeout, but Libyan civil unrest still threatens supply crunch
Stocks are losing their friends in Apr. After a good start in the first week, selling is now the popular emotion for traders. Even sexy tech stocks are being sold. Trade issues are not being resolved. Earnings from the big banks will be reported in the next few days followed by corp results. Expectations are low. More selling seems to lie ahead.
Dow Jones Industrials
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